Tag Archives: adam smith

My citation of one of New Economic Perspectives’ distinguished academic readers from the field of economics, Michael Meeropol, prompted another distinguished academic reader from the same field to note that he had made the same point about the distortion of Adam Smith’s views on topics like “outsourcing” through foreign investment. The context was N. Gregory Mankiw’s distortion of Smith to try to support the Trans-Pacific Partnership. Here is how Jamie made the point in his classic book The Predator State.

One of our many distinguished readers of New Economic Perspectives is the economist Michael Meeropol. Mike contacted me after reading my columns about Mankiw pushing the Trans-Pacific Partnership (TPP) to alert me to another way in which Mankiw, who purports to be relying on Adam Smith, actually willfully misinterprets Smith through what Mike refers to as “pedagogical malpractice.” I thank him for bringing it to my attention.

Mike laid this out in an article in 2004. Reading Mike’s entire superb article is, of course, the best solution. For those with less time I have quoted extensively from the most relevant portion of his article, which includes a lengthy footnote. Mike’s major point can be summarized briefly: Smith believed fervently in emphasizing domestic manufacturing and agricultural production, domestic trade, and domestic investment as the essential means of building a Nation’s wealth. Mike’s article builds on the work of Joseph Persky. I’ve deleted two footnotes from his text.

The Ebook DIAGRAMS & DOLLARS (in top 10 best-sellers on Amazon/ category money & monetary policy!) paints an optimistic picture of what “Sovereign Spending” could achieve for our collective benefit. The video made from it (approaching 3,000 views on YouTube—thank you Haiku Charlatan!) ends with cheering calisthenics around the final diagram of our national prosperity. Unfortunately, the “real world” of our Congressional leaders and media spin-machine is painting a very different picture—a dire vision of out-of-control government spending and national insolvency. Understanding why that is, and what we can do about it, is the real challenge we have before us.

“Pink slime” just had its fifteen minutes of fame. BPI, the producer of pink slime, calls it “Lean Finely Textured Beef.” BPI’s slogan is “expect a higher standard.” Pink slime starts with fatty tissues that are inherently more likely to be repositories of salmonella and e coli infections. The tissues are shredded and rendered and most of the fat drained off. The pink slime, however, is still more likely to be infected after this processing and that makes it dangerous and can make it smell spoiled. BPI’s “innovation” was to gas the pink slime in Mr. Clean (ammonia) to try to kill bacteria and reduce the stink. The resultant pink slime is then frozen into bricks and shipped in bulk.

Americans living in rural areas should brace themselves for a new dose of pain. As the USPS approaches the end of its fiscal year, where it will be unable to make payment of $5.5 billion to its employees health benefits fund, it is considering closing over 3600 facilities nationwide. Just yesterday they placed on the chopping block another 250 processing centers. Most of these closures are distributed throughout rural areas, a demographic that has borne a considerable amount of hardship throughout this entire contraction. For an interactive map of the proposed closures go here.